Melbourne is still a surprisingly affordable city for average-income borrowers looking to buy a house near the water and be a reasonable commute from the city, new figures show.
Unlike Sydney, Brisbane, Perth and Adelaide, the median house price hasn’t been soaring by double-digit figures at some point during the past year.
Intriguingly, Melbourne’s median house price has also been growing at a slower pace than wages, despite receiving a large intake of overseas migrants, with Brisbane now on track to overtake it.
In the year to April, its mid-point house price grew by 3 per cent, which was well below the wage price index of 4.2 per cent, new CoreLogic data released on Wednesday showed.
While the median house price of $941,698 is still dear, there are suburbs near Port Phillip Bay where the mid-point price is still under $600,000.
This is despite Melbourne’s population growing at a faster pace than Sydney’s, as fewer people left the Victorian capital following an influx of new overseas migrants.
Melbourne is still a surprisingly affordable city for average-income borrowers looking to buy a house near the water and be a reasonable commute from the city (pictured is a man outside Flinders Street Station)
Frankston North, a one-hour train ride located 53km south-east of the city, has a median house price of $597,429, making it affordable for an average, full-time worker on $98,218
Frankston North, a one-hour train ride 53km south-east of the city, has a median house price of $597,429, making it affordable for an average, full-time worker on $98,218 as values rose by just 3.3 per cent over the year.
Living near the water is now cheaper than doing the same thing 50km north of Brisbane, where Caboolture’s median house price is $660,993 – following a 13.7 per cent annual increase.
Brisbane’s median house price during the past year has soared by 15.9 per cent to $920,046, putting it within striking distance of overtaking Melbourne.
But it was far from the only state capital city where prices soared with Perth’s median house value soaring by 21.3 per cent to $753,947, as Adelaide’s mid-point climbed by 13.9 per cent to $800,648.
Sydney is still Australia’s most expensive capital city with a median house price of $1.421million but its annual growth pace of 9.6 per cent is a moderation from the double-digit figures of 2023 and early 2024.
Living by the water is also a lot dearer, even for those on the Central Coast an hour’s drive north, with Woy Woy having a mid-point house price of $948,550, following a 9 per cent increase during the past year.
Canberra is Australia’s second dearest city with a median house price of $972,699 but the 2.8 per cent annual growth pace was also weaker than the wage price index.
Hobart was the only state capital city where prices went backwards, with house values falling by 0.2 per cent to $692,004.
Darwin’s median house price grew by just 1.4 per cent to $579,229.
Brisbane’s median house price during the past year has soared by 15.9 per cent to $920,046, putting it within striking distance of overtaking Melbourne (pictured is a house in Moorooka)
Australian property prices grew for the 15th straight month in April, with values up 11.1 per cent or $78,000 since the trough in January last year, reaching $779,817.
CoreLogic research director Tim Lawless said an undersupply of housing was driving demand, especially in Perth where houses are typically selling in just 10 days.
‘Such a mismatch between available supply and demonstrated demand is keeping markets skewed in favour of sellers in most cities,’ he said.
This is occurring despite the Reserve Bank in November raising interest rates for the 13th time in 18 months to a 12-year high of 4.35 per cent.
Melbourne’s slower house price increase is surprising, given that it has a low rental vacancy rate and had a 3.3 per cent population growth pace in 2022-23, compared with Sydney’s 2.8 per cent, Brisbane’s 3.1 per cent and Perth’s 3.6 per cent.
A Gen-Z property investor who owns three properties has shut down claims landlords are at fault for Australia’s current rental crisis.
Harley Giddings, 24, has worked hard since adolescence and in every job ‘under the sun’ to own a house and is now the proud owner of multiple investment properties.
The young investor posted a TikTok to his thousands of followers saying he often gets comments ‘all the time’ that blame investors for the housing shortage.
The savvy landlord said he can understand Aussies’ frustrations but thinks this is ‘misguided’, firmly believing the sky-rocketing rents and housing shortage lie with high immigration and low building approvals.
‘In 2022 and 2023 the government let in over a million migrants into the country,’ he said.
Harley Giddings, 24, has a property portfolio consisting of three investment properties. He understands people are ‘hurting’ but believes Aussies are ‘misguided’ when blaming landlords for the rental crisis
‘Basic supply and demand’ is the reason for the Australian housing crisis, according to the 24-year-old
‘According the Australian Bureau of Statistics, this is the most amount of migrants Australia has ever let into the country since they started recording.
‘These one million migrants were let in at a time when Australia already had a housing crisis.’
Mr Giddings said that when people arrive in Australia they are looking at renting and not buying, which is why so many people are at inspections for rental opens.
‘Basic supply and demand,’ he said.
The second reason the young property investor gave for the housing shortage in Australia was the low amount of homes being built.
‘We are simply not building enough properties,’ he said.
‘In Victoria, my home state, we currently have the lowest amount of building approvals that we’ve had in the last decade.
‘This issue is Australia-wide.’
The 24-year-old quoted research from the Institute of Public Affairs that by 2028 Australia’s housing supply will be short by 252,800 homes.
Many Australians agreed with the young investor, also blaming the government.
‘Absolute master stroke by the government,’ one wrote.
‘Not to mention all of Victoria’s new tax laws on investments, landlords are getting rid of them,’ one said.
‘If you can’t keep up with supply reduce the demand,’ another wrote.
Mr Giddings said the the low number of houses being built in Australia is a major reason for rents increasing so high (pictured people at an auction)
However, other Aussies were quick to throw blame back at the investor.
‘You are also the problem. You cannot just blame building and immigration. You know why people can’t afford to build? Because they can’t afford the increased prices driven up by decades of investors,’ one wrote.
‘Investors and immigration: two problems [that] need to be stopped,’ another said.
Mr Giddings told Yahoo he understands it would be very hard at the moment to be a renter and there’s a lot of ‘hurt’ due to prices increasing not just in rent, but everything else as well.
‘I just think there’s a couple of factors that is like worsening the housing crisis that isn’t caused by renters or landlords,’ he said.
The investor, who became interested in property after reading multiple books and listening to podcasts about investing, made it clear to Yahoo that he did not blame the people moving to Australia, but government policy.
Mr Giddings dropped out of university half-way through his business degree because he didn’t think it would offer him much.
The 24-year-old instead worked two jobs, seven days a week, saving more than $100,000 by age 22.
Mr Giddings, who describes his family as middle class, went halves with his dad for his first property, as told by Yahoo.
The young investor believes high rents and a competitive market has been created by the government allowing one million migrants into the country in the middle of a housing crisis
‘My parents aren’t really the kind of investment-savvy people. Like, dad’s a firefighter, mum’s a hairdresser. So he had the borrowing power because he was working full time and I had the savings,’ he said.
The hard-worker, who has always been interested in investing, purchased away from his state of Victoria and instead invested in Western Australia.
‘There’s 15,000 suburbs in Australia, it’s highly unlikely that the area you live in is going to be one of the best performing,’ he said.
The first property cost the father and son $450,000 and then the 24-year-old used more savings to buy a second property.
Mr Giddings used the equity built up in the second property to purchase his third investment.
This impressive property portfolio was achieved by the time he was just 23.
According to the Australia Tax Office, most landlords are ‘mum and dad’ investors, with a massive 71 per cent of landlords in Australia owning just one investment property.
Only 19 per cent own two properties.
According to the Australian Bureau of Statistics work begun in 2023 on just 163,836 new houses, which is the lowest amount since 2012.
Compounding the issue is a 90,000 tradie shortage, who are needed in the next three months so the government’s housing plan can stay on deadline.